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The Quality of Metal Stamping in the USA

 

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Amongst the many manufacturing processes which are being outsourced to other countries is metal stamping. The lower labor costs available in these countries make an attractive option for manufacturers who are seeking ways of reducing their costs, in an effort to maintain whatever competitive advantage they can. Even with the added cost of shipping these components from such long distances, the lower labor and overhead rates still provides a savings.

Overseas Manufacturing Capability and Costs

When many people think of overseas manufacturing, they think of Japan. Since the end of World War II, when Japan really started emerging as a manufacturer of products for the international market, their design, quality and innovation has increased. Today, Japan has reached a point where their products can compete in the world market with anyone’s.

However, overseas manufacturing isn’t done in Japan. Their labor costs aren’t much lower than American ones, eliminating that competitive advantage. In 2010, the average fully loaded cost per hour of an American worker was $34.74, with Japan close behind at $31.99. By comparison, Mexico was $6.23, Taiwan was $8.36 and China was a mere $1.55.

It is these emerging countries which are receiving the lion’s share of this offshore manufacturing business. With labor rates like this, no wonder so much manufacturing has been moved to these offshore manufacturing countries.

Okay, so what are American companies receiving for these labor rates? For those of us who are old enough to remember when Japanese products really hit the American market in force back in the 1960s, we remember that while Japanese products were cheap to buy, they were also cheaply made. In that time period, Japanese products weren’t known for their quality, instead, they were what one bought when they didn’t care about quality.

An Offshore Manufacturing Facility

Have you ever visited an offshore manufacturing facility in an emerging country? Much of their equipment is comprised of old equipment removed from American factories which was to be replaced by newer equipment. As old equipment, it’s held together, as we used to say, “With chewing gum and baling wire.” Breakdowns are common, and repairs are no more than what is necessary to bring the machine back to life.

Old equipment like this can’t hold the level of accuracy required for some component’s tolerances. Added to that is a young, inexperienced workforce. One of the challenges in Mexico is maintaining workforce consistency. Turnovers as much as 20% from day to day and 100% from week to week are not uncommon.

Without workforce stability, training costs are multiplied. Even worse, since the investment in training may very well be lost, training is usually kept to a minimum. Jobs are simplified, so that they can be done with that minimal level of training. Unfortunately, that means that the available workforce to produce high-quality parts is minimal.

Want Quality? Go American!

What this boils down to, is that if you want quality components, you need to go American. Most manufacturers in these countries don’t have the capability of handing complex stampings, multi-stage stamping processes, tight tolerances and secondary operations.

For simple stampings, yes, it is possible to save money by going offshore. But, for complex, intricate or tight-tolerance parts, American quality still can’t be beat. The higher level of training and experience in the American workforce, coupled with high-grade manufacturing equipment, which is regularly maintained, ensures quality finished products.

American tool & die design, processing and part production can stand up to comparison with anyone in the world. When we buy American, we’re helping keep our fellow citizens working and America strong.

Key Takeaways:

  • Offshore labor rates are lower, providing lower cost piece parts.
  • Offshore manufacturing is mostly using old equipment, when has been removed from American factories.
  • Offshore factories can’t match American ones for quality.
  • Offshore fabricators can’t handle complex, multi-stage or intricate parts with consistent quality. 

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